Digital Currency Group Sells Shares in Subsidiary’s Crypto Funds

Digital Currency Group (DCG), a cryptocurrency conglomerate, is apparently preparing to generate cash and keep its liquidity by selling its assets in cryptocurrency fund managed by Grayscale Investments.

A Financial Times report published February 7, which cited US securities filings, stated that DCG sold roughly one quarter of its shares to Grayscale’s Ether fund (ETH-based) for $8 per share. This despite the fact that each share had a claim to almost twice that amount in ETH. In the report, these filings were cited.

It is also reported to have sold small shares in Grayscale’s Litecoin, Bitcoin Cash (BCH), or Ethereum Classic (ETC).-based trusts. This fund, along with its Digital Large Cap Fund, invests in Bitcoin, Ether, Polygon, Polygon, Solana, SOL, Cardano, and Polygon (MATIC).

DCG’s response to DCG when asked about the share sale was “it is just part our regular portfolio balancencing.”

Others feel that Barry Silbert’s DCG could be facing financial difficulties despite this declaration.

Genesis Global Capital, a cryptocurrency lending company, filed bankruptcy papers on January 19. It is believed that it owes its creditors more than $3B.

DCG-controlled companies have been severely impacted by the contagion caused by FTX’s collapse. Over 500 people have been fired by these companies in the last few weeks.

DCG has taken several actions to ensure liquidity in 2023. This includes informing shareholders, in a January 17th letter, that it will be ending its quarterly dividend payments in order to improve its balance sheets. This was one of many initiatives DCG has taken.

DCG stated that it received offers for CoinDesk’s cryptocurrency media outlet. However, DCG reportedly sought financial advice firm Lazard’s assistance to help it weigh up the options of selling CoinDesk. This is another of its subsidiaries.

According to DCG’s website, the company has invested in approximately 200 startups related to crypto. These include Grayscale and Genesis as well as CoinDesk. DCG also has an interest in several other businesses such as Luno, a cryptocurrency exchange, and Foundry, an advising company.

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